Underestimating Property Costs
Owning income-producing property is the dream of many business people today. Unfortunately, there is more to it than buying a property and hanging a rental sign. Many property owners learn from experience; however learning from mistakes is not financially feasible in today’s market. Overwhelmed already? Learn more about professional property management services in San Diego and check out the dangers of underestimating property costs.
Property costs go beyond the initial price tag. The cost of occupancy inspection is nominal, and property taxes, insurance and mortgage payments are often considered and planned for during the purchase. Other costs, however, need to be considered as well and can sometimes fluctuate from one year to another.
- Maintenance and damages. Be certain to budget enough money for damage caused by tenants. Normal wear and tear is bound to happen, but it is important to also budget for unforeseen circumstances. Your lease may entitle you to some money from the security deposit, but it’s always good to have a safety fund so you can make the repair as soon as possible. Also, if you’re not taking on the repairs yourself, be sure to budget for the cost of labor. Many first-time landlords make the mistake of underestimating how much it will actually cost to fix a leaky sink or repaint a wall.
- Renovations and upgrades. Depending on the age of your rental property, you may have to renovate or upgrade certain aspects such as the flooring or plumbing. Carefully examine your property and be realistic on what will need to be updated in the near future, as well as its cost. Are you an apartment manager in San Diego? You may want to consider hiring a single contractor who will be able to handle all of your renovations and upgrades.
- Landscaping. The outside of the home is just as important as the inside! Although some responsibility may fall on the tenant to maintain landscaping, most falls upon the landlord. You’ll need to budget for routine landscaping and be prepared for additional landscaping needs as the seasons change.
Being a landlord isn’t for everyone! If you still want to reap the financial benefits but would prefer assistance from a professional property management company, reach out to Harland Property Management. Read our property management reviews and then contact us at 858-367-0343 to request a free quote!